Viren Rastogi, the London metals trading tycoon behind one of Britain's biggest ever frauds, has been ordered to serve seven years behind bars on top of an initial sentence of nine-and-a-half years because he has failed to return millions of pounds defrauded from 20 international banks.

The banks – including West LB, JP Morgan Chase and Dresdner Bank – lost more than £400m after they were duped into backing a series of bogus metal shipment trades by Rastogi's firm RBG Resources and related companies.

Administrators believe much of the money disappeared to the notoriously secretive British Virgin Islands, as well as to Dubai and India. Investigators have located few assets in Rastogi's control beyond a Marylebone home, believed to be worth about £6m. However, he has been unable to persuade the court that he does not have at least a further £13m in hidden assets. The true amount he has salted away may be much higher.

In 2008 Rastogi was described by the judge who handed down the original sentence as "the real brains" behind the fraudulent enterprise, which also involved operations in New York, Hong Kong and Singapore.

Four years earlier, Viren's brother Narendra Rastogi secured a reduced jail term of seven years in a parallel US prosecution after agreeing to give evidence against his UK sibling.

As part of this plea-bargain deal with US prosecutors, Narendra confessed to a US court that: "I agreed with … Viren Rastogi … to commit the crime of bank fraud … Money obtained through fraud … [was] diverted and transferred through numerous accounts and businesses for the purpose of concealing the true source of the assets."

Two other brothers, Ravindra and Subash Rastogi, were named in UK criminal proceedings among a handful of alleged co-conspirators who are said to have helped to create an elaborate web of 300 bogus metals trading counterparties. Neither have faced prosecution.

The new jail sentence extends Viren Rastogi's total tariff to sixteen and a half years, which is thought to be the second highest ever handed down to defendant in a SFO case. He could be freed from jail and reunited with any assets he may have abroad in five years' time if he demonstrates good behaviour. Handing down the additional jail sentence on Thursday, judge Michael Snow said Rastgoi had demonstrated "wilful refusal or culpable neglect" in not returning the £13m ordered by the court.

Oligarch deadline

Fugitive oligarch Mukhtar Ablyazov, the former head of BTA Bank who is accused of embezzling $5bn (£3bn) from the Kazakh lender, is under pressure to turn himself in or risk being debarred from defending himself against fraud claims.

The bank asked judge Nigel Teare to give Ablyazov until 4pm on 2 March to give himself up, or remove his right to defence against the embezzlement claims that rank among the biggest ever heard in Britain.

It also asked for Ablyazov to be debarred from offering a defence if he fails to fully divulge his assets by 4pm on 9 March. A judgment is expected next week.